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Changes ahead for deemed interest on shareholders invested capital in Brazil

Brazilian income tax reform proposal advances

Fernanda Sampaio, Bruno Santo and Milton Schivitaro of Finocchio & Ustra bring the actualisations from Brazil’s potential income tax reform after the approval by the Chamber of Deputies

Brazilian Supreme Court ruling on the exclusion of ICMS from PIS/COFIN

The ruling brings more legal certainty for taxpayers On May 13 2021, the Brazilian Supreme Court (STF) concluded the trial of one of the largest tax discussions in Brazil relating to the exclusion of ICMS (state sales tax) in the PIS/COFINS (federal contribution on total revenue) tax base (as discussed in Challenges and complexities of the Brazilian tax system). March 2017 ruling  After more than 20 years of intense judicial debate, on March 15 2017, the STF’s Justices started to analyse and decide on the issue and adopted a favourable understanding for taxpayers, recognising and ruling, at that time, that ICMS should be excluded from the PIS/COFINS (federal contribution levied on revenue) taxable basis, as it is not characterised as gross revenues.

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